It’s quite hard to imagine the lump in the throat of an individual who witnesses a wild fluctuation in the price sitting from outside. Whether it be a simple investment in a stock exchange or any money-making scheme which promises him a good return on his investment. This lump in the throat gets quite weird when you get to know that there is such wild fluctuation possible in the cryptocurrency world.
It seems quite a churn in the stomach as you still have a little know-how of the mechanism of the cryptocurrency even though you have invested on the opinions and suggestions of your well-wishers just adding a little bit of your intellect and instinct. If the fluctuation is there in the traditional system you get an air of assurance by your well-wishers that this is just due to the market conditions and we can do nothing much. But what about this fluctuation? This has happened due to something called the “Fork” and you find a fork hinged in your throat. Then the only question hovering in your mind is what the fork is?
First of all we need to understand that “Fork” is a phenomenon and it occurs mainly due to two different events.
Accidental Fork:- It happens when the coin updates are not truly compatible.
Different people using different versions of software create two different ledgers, one from the older version and the other from the newer version. This circumstance forces the coin developer to rapidly eliminate the bugs which causes the incompatibilities and then decides how to merge the different blockchains.
Hard Fork:- It happens when there is a change in the programming of the coin.
The change in the programming of the coin creates incompatibility between the new and the older ones which do not leave an option for the old users except updating the application.
Forks are not only bad for the individuals but it is equally damaging for companies. If there is a fear of losing money for individuals then the business of the companies using particular coins are handcuffed as its’ of no use. It also becomes an alarming situation for the particular cryptocurrency as the fear of losing money scares the masses which in turn will result in the deteriorating value which will eventually lead to its downfall.